Best Practices

COVID-19 Funding Relief and Financial Tools for Small Businesses

Published Apr 30, 2020
by Sarah Mote

The COVID-19 pandemic has hit small Main Street businesses especially hard. Mindful that small businesses are the backbone of the U.S. economy, numerous government agencies, philanthropies and private companies have set up relief funds to provide these small businesses with grants and low-interest loans as well as free services and tools to remain operational.

The following is a list of many of those resources.

FEDERAL

CARES Act/U.S. Small Business Administration

Paycheck Protection Loans

The U.S. Small Business Administration (SBA) will guarantee loans to help businesses with fewer than 500 employees keep their workforce employed during the COVID-19 crisis. Businesses may qualify for loans of up to $10 million (8 weeks of payroll) through participating lenders such as banks and credit unions. Businesses that qualify are eligible for a loan deferment for six months to a year, and the loan may be forgiven if the businesses maintains its payroll for eight weeks at employees’ normal salary levels. Portions of the loans can also be used for rent, health benefits, insurance premiums, utilities, etc.

Economic Injury Disaster Loans

The EIDL loan program is an existing program that provide economic relief to businesses that are experiencing difficulty. These are working capital loans of up to $2 million with an interest rate of 3.75% for small businesses and 2.75% for nonprofits. The program been updated to include sole proprietors and businesses with fewer than 500 employees.

In addition, one feature of the EIDL program is the Emergency Advance, which provides for up $10,000 of economic relief that does not need to be repaid.

SBA Debt Relief

The SBA is providing debt relief for existing and some new traditional SBA loans. The SBA will automatically pay the principal, interest and fees of current 7(a), 504 and microloans for 6 months. The agency will also pay the principal, interest and fees of new 7(a), 504 and microloans issued before Sept. 27, 2020.

The U.S. Treasury Department, IRS and U.S. Department of Labor have announced that small and midsize companies can begin taking advantage of two new refundable payroll tax credits, designed to immediately and fully reimburse them, dollar-for-dollar, for the cost of providing coronavirus-related leave to their employees.

OTHER SMALL BUSINESS ASSISTANCE PROGRAMS

Many banks have offered deferment and forbearance to business loan customers having trouble making payments. Check Forbes’ list of banks offering relief. You can also search for your bank on the American Bankers Association’s ongoing A-Z list of coronavirus response programs.

Small business owners across the country are feeling the impacts of the coronavirus outbreak and the economic ripples it’s caused. Check out these coronavirus small business grants that businesses in your community might be eligible for. And we’ve pulled out a few relevant funding opportunities below.

Amazon Neighborhood Small Business Relief Fund

Amazon has created a $5 million grant fund for small, independent businesses in the Seattle neighborhoods of South Lake Union and Regrade. Basic eligibility includes businesses with fewer than 50 employees or less than $7 million in annual revenue. In addition, from March 26 to April 30, Amazon Lending is pausing repayment from sellers who have outstanding loans, and seller loans will not accrue interest during that time.

Will not terminate the service of any wireless, home phone or broadband residential or small business customer because of their inability to pay their bill due to disruptions caused by the coronavirus pandemic

Will waive any late payment fees that any wireless, home phone or broadband residential or small business customer may incur because of economic hardship related to the coronavirus pandemic

Will keep public Wi-Fi hotspots open for any American who needs them

Bacardi #RaiseYourSpirits

Bacardi has pledged $3 million in relief through its #RaiseYourSpirits campaign. The initiative is intended to provide aid to bars and restaurants affected by the COVID-19 shutdown.

BARDA, part of the U.S. Department of Health and Human Services is continuing to work on identifying promising medical countermeasures and technologies to combat the 2019 novel coronavirus.

Duke University #COVID19 Capital Relief Tool

Duke University has created a COVID-19 funding tracker, a searchable database of grants, loans and cash equivalents that can help entrepreneurs, nonprofits and businesses.

Facebook Small Business Grants Program

Facebook is providing $100 million in cash grantsand advertising credits to small businesses around the world. The grants will be offered to up to 30,000 for-profit businesses in more than 30 countries. Companies must have between 2 and 50 employees, been in business for more than a year, experienced challenges from COVID-19 and be in or near a location where Facebook operates.

Fattmerchant & Gift Up!

Payment processor Fattmerchant has partnered with Gift Up! to allow its clients to sell virtual gift cards. Gift Up! is waiving its 3.49% fee for Fattmerchant’s members’ first $5,000 in gift card sales.

Freelancers Relief Fund

The Freelancers Union hascreated a relief fund that provides up to $1,000 of financial assistance to freelancers to use for food/supplies, utility payments, income loss, etc.

GoFundMe Small Business Relief Initiative

GoFundMe started the Small Business Relief Initiative help small businesses impacted by COVID-19. The company partnered with Yelp, Intuit QuickBooks, GoDaddy and Bill.com to provide financial support and resources.

GoFundMe and Yelp partneredto allow independent businesses to start fundraisers and accept donations via Yelp. The program was updated in mid-April. Get details here.

As part of the Small Business Relief Initiative, these companies have each donated to the Small Business Relief Fund. Supporters can donate to the Small Business Relief Fund, which will issue $500 matching grants to qualifying businesses that raise at least $500 on GoFundMe.

Goldman Sachs Stimulus Package

Goldman Sachs has committed to two small business initiatives, totaling $300 million, including a Small Business Stimulus Package that allocates $250 million in emergency loans and $25 million in grants. The second initiative offers another $25 million as part of the Goldman Sachs COVID-19 Relief Fund.

Google

Google has pledged $800 million in COVID-19 relief to small and mid-sized businesses, health organizations and governments, frontline health care workers. The relief breakdown is as follows: $250 million in ad grants to the WHO and other government agencies globally, $20 million in ad grants to community financial institutions and NGOs, $200 million investment fund to support NGOs and financial institutions to help provide small businesses with access to capital, $340 million in Google Ads credits to SMBs with active accounts over the last year, $20 million in Google Cloud credits for academic institutions and researchers, direct financial support and expertise to assist with the production capacity for PPE and medical devices, and an increase in the $7,500 annual gift match Google offers to employees annually to $10,000.

Hello Alice Business for All Grants

Digital fundraising and advocacy platform Hello Alice is working with Verizon, Silicon Valley Bank, Ebay and others to provide $10,000 emergency grants to small business owners impacted by the coronavirus pandemic.

Honeycomb Crowdfunded Small Business Relief Loans

Crowdfunding platform Honeycomb Credit is offering a small business relief loan program that provides $10,000 to $50,000 in working capital to qualifying businesses. The loans include a 45-day payment-free period and an initial 6-month interest-only period as well as no prepayment penalties.

James Beard Foundation Food and Beverage Industry Relief Fund

The Food and Beverage Industry Relief Fund was established to provide microgrants to independent food and beverage small businesses. Acceptance of applications has been suspended, but interested parties may still donate to the fund, and applications may be reopened.

JPMorganChase

JP Morgan has pledged $50 million in COVID-19 relief, including $5 million to provide immediate health care, food and humanitarian relief globally; $2 million to existing nonprofit partners around the world responding to the COVID-19 crisis and $8 million in aid to small businesses in the U.S., China and Europe.

Kabbage Payments

Kabbage launched an online portal that allows U.S. small businesses to create free accounts to sell gift certificates online. After businesses register, they can send a custom link to their customers. Anyone can purchase the gift certificates through the portal and use them at a later date.

Kangaroo Small Business Initiative

Electronics company Kangaroo is offering small businesses owners security camera and monitoring kits free for their offices for up to three months.

KivaLoans

Kiva isoffering small businesses loans of up to $15,000 at 0% interest and a grace period of up to six months.

Mark Cuban is reimbursing employees for any lunch or coffee/tea purchases they make from independent small businesses.

Microsoft

Microsoft is offering a free 6-month trial of Office 365 E1 Trial for businesses who need employees to work from home during the coronavirus crisis.

Mozilla COVID-19 Solutions Fund

Mozilla launched a COVID-19 Solutions Fund as part of the Mozilla Open Source Support Program. The fund will provide awards of up to $50K each to open source technology projects which are responding to the COVID-19 pandemic in some way.

Opportunity Fund is working with investors and nonprofits to create a coronavirus relief fund to provide grants and low-interest loans to business owners. The organization specializes in money lending to small businesses owned by women, immigrants and people of color.

Reclamation Ventures Wellness Relief Fund

Reclamation Ventures opened a grant opportunity to cover one month of missed revenue (up to $2,500) for wellness spaces and wellness instructors who represent underestimated communities.

Red Backpack Fund

The Spanx by Sara Blakely Foundation has donated $5 million to support female entrepreneurs in the wake of COVID-19. GlobalGiving will oversee the Red Backpack Fund, making 1,000 grants of $5,000 each to female entrepreneurs in the United States to help alleviate the immediate needs and support the long-term recovery of those impacted by this crisis.

Republic Services “Committed to Serve” Initiative

Republic Services has launched "Committed to Serve," its $20 million initiative to help its employees, customers, small businesses and communities across the U.S.

Key elements of the program include meals and gift cards purchased from local small businesses. The company will also donate $3 million to the Republic Services Charitable Foundation to fund its long-term nonprofit partners that operate locally and serve local communities and small businesses.

Restaurant Employee Relief Fund

The National Restaurant Association Educational Foundationhas established the Restaurant Employee Relief Fund to provide grants to restaurant owners and employees in need.

Revel Systems Relief Program

Cloud-based point of sale company Revel Systems has created Revel Relief Program, a $1 million fund that will be allocated to small business customers.

Ring “Neighbor Pledge” Initiative

Ring’s Neighbor Pledge initiative brings together individuals and community groups who create pledge groups that support local businesses.

Salesforce is partnering with Ureeka to offer eligible small businesses the opportunity to receive a $10,000 grant to help them through the COVID-19 outbreak. Grant Applications opened on April 27.

Shea Moisture

Shea Moisture has established a $1 million relief fund for small businesses impacted by COVID-19 and owned by entrepreneurs of color and women.

U.S. Chamber of Commerce Foundation Save Small Business Fund

The U.S. Chamber of Commerce Foundation has launched a grant program, funded by corporate and philanthropic partners, that provides $5,000 supplemental grants to small businesses.

Verizon & LISC

Verizon is waiving late fees for small business or residential customers due to COVID-19-related issues for the next 60 days. The company will also not terminate service to any customers who are unable to pay their bills due to COVID-19 and is adding an extra 15GB of data to all consumer and small business plans.

The company has also allocated $2.5 million to small businesses through the Local Initiatives Support Corporation. Grants of up to $10,000 are available to small companies facing immediate financial threat from the COVID-19 pandemic, especially those owned by entrepreneurs of color and women as well as those located in historically underserved places.

Yelp has created a $25 million relief response the focuses primarily on supporting independent local restaurant and nightlife businesses. The assistance takes the form of waived advertising fees and free advertising, products and services.

Also see the GoFundMe entry above for Yelp’s involvement in that initiative.

Image credit: Mike Petrucci, Unsplash

Sarah Mote is the marketing director at SourceLink. Sarah brings her experience as an entrepreneur, storyteller and content strategist to help shape the story of SourceLink and that of our affiliate communities.

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